Which of the Following Statements Regarding Factors That Influence How

question 63

Multiple Choice

Which of the following statements regarding factors that influence how auto insurance premiums are set is true?

• A) Insurance companies charge lower rates for rear-engine models.
• B) Rates are lower if the insured automobile is driven less than 20 miles one way to work.
• C) In most states, accidents determined to be the insured's fault incur points and a premium surcharge.
• D) Discounts are often given for a vehicle that is driven less than 100,000 miles a year.
• E) Because they are involved in a larger percentage of fatal crashes, unmarried females under age 30 pay higher premiums than do older individuals.

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Definitions:

Selling Stock

The act of disposing of shares in a company, either privately or publicly, typically to raise capital or realize gains from investment appreciation.

Abnormal Returns

Returns on a security or portfolio that exceed the expected rate of return, not predicted by market models or theories.

Direct Expenses

Costs directly attributable to the production of a specific product or service, such as materials and labor.

Rights Offering

A rights offering is a method by which a company raises capital by offering existing shareholders the right to buy additional shares directly, usually at a discount to the current market price.